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Tackle the tech skills shortfall for successful digital transformation

Published 8 May 2023 in Innovation • 4 min read

Closing the talent gap is going to be critical if organizations are to navigate the challenges and opportunities posed by generative AI, including OpenAI’s ChatGPT and Google’s Bard

The rush of ground-breaking artificial intelligence launches over the past six months, including Microsoft-backed OpenAI’s ChatGPT and Google’s own chatbot Bard, has made digital transformation an even greater priority for organizations. But all too often, these projects fail – miserably – because of an acute shortage of technology talent.  

As I discussed at last week’s #GrowthSummit23, hosted by the World Economic Forum, closing that gap, through the methods outlined below, is going to be critical if organizations are to harness AI to accelerate their digital transformation – and parry threats to their business models. 

Generative AI can produce highly sophisticated text responses to human prompts and promises to speed up digital transformation. But even before the latest wave of AI advances, the vast majority of large-scale digital transformation projects were failing to deliver value, resulting in wasted resources. 

One solution is to bridge the digital-skills gap, which has been building for years around the world because of the rapid digitization of non-tech companies. Tech groups, including Microsoft and Amazon, may be letting people go, but businesses in virtually every other sector want to snap them up. Demand, however, far exceeds supply, particularly in data science and cyber security, where skills shortages are hobbling digital-transformation projects.

To deliver a successful transformation, companies will need to find ways to grow the pool of digital talent, at all levels of the workforce.

And it’s not just entry-level recruits that are missing: many business leaders lack the digital skills they need to orchestrate digital transformations, leaving many projects without clear business objectives. Little wonder so many fail. 

Solving technology’s image problem 

To deliver a successful transformation, companies will need to find ways to grow the pool of digital talent, at all levels of the workforce. Doing so will require tackling tech’s image problem. From the outside, digital jobs are often seen as being purely operational, but in reality, they are strategic business roles. Companies need to do a better job of communicating how digital transformation is at the core of business in the 21st century, to make the work more enticing to potential recruits. 

That would also go a long way towards tackling the chronic lack of diversity in the technology field, particularly the shortage of women. Diversity is important because it brings different perspectives, capabilities and skill sets to the table. 

Building multi-stakeholder partnerships 

Additionally, companies need to come together with the education sector in multi-stakeholder partnerships to ensure the curriculum is responsive to industry changes. That will empower tech graduates to hit the ground running when they embark on their careers. What is often missing from education programs is a focus on non-technical skills, including communication and emotional intelligence, which are both critical to success in digital roles. 

But it’s not just about forming policies to get the right people in the door: you need strategies to keep them in the room. So shallow is the pool of candidates that companies are poaching the staff they need from rivals. The rate of attrition is through the roof, which can frustrate companies that invest substantial time, money, and effort in hiring the right candidates, only to lose them a few months down the line to a competitor. 

Invest in learning and development 

It’s a seller’s job market for those with tech skills, so buyers need to give them a good reason to stay put. Raising wages will only go so far, you’ll also need to invest in their learning and development. When employees feel valued and have a sense of professional growth, they are far more likely to be loyal. 

Raising wages will only go so far, you’ll also need to invest in their learning and development.

Moreover, the pace of technological change is so rapid that staff need to constantly revise their capabilities, skills and expertise, particularly as AI advances quickly and threatens some human tasks. Therefore, lifelong learning will have an important role in tackling skills shortages and upskilling workers.  

Companies cannot rely on the education sector alone to provide people with the necessary digital skills: they need to train them on the job. Traditional degrees are still desired for many digital roles, but alternative learning methods, including micro-credentials are gaining momentum. They can help employees stay at the frontier of knowledge in technology, but in ways that are more flexible and affordable. It’s also a way for employers to give staff opportunities to gain skills in a variety of formats. 

 Those skills are ultimately going to be critical to the success of digital transformation, which is becoming even more of a business imperative as AI advances and poses both a threat and opportunity to business models. To close the digital-talent gap and equip workers with the skills they need for the future, organizations should be focused on fixing tech’s image problem, building multi-stakeholder partnerships, and investing in alternative training programs. 



Oyku Isik IMD

Öykü Işık

Professor of Digital Strategy and Cybersecurity at IMD

Öykü Işık is Professor of Digital Strategy and Cybersecurity at IMD, where she leads the Cybersecurity Risk and Strategy program. She is an expert on digital resilience and the ways in which disruptive technologies challenge our society and organizations. Named on the Thinkers50 Radar 2022 list of up-and-coming global thought leaders, she helps businesses to tackle cybersecurity, data privacy, and digital ethics challenges, and enables CEOs and other executives to understand these issues.


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